Recording Entries for Impairment-AFS Determine the amount of impairment loss (if any) to record in income under the following three separate scenarios for an AFS debt investment. In all three cases, the company does not intend to sell and does not believe it is more likely than not that it will be required to sell the investment before recovery of any unrealized loss. Assume that the company has already adjusted the AFS investments to fair value through OCI. Scenario Fair value $ Amortized cost $ Expected credit loss $ Impairment loss $ 1 216,000 $ 192,000 $ 36,000 $ 0$ 2 168,000 $ 192,000 $ 36,000 $ 24,000 3 144,000 192,000 36,000 48,000 x
Recording Entries for Impairment-AFS Determine the amount of impairment loss (if any) to record in income under the following three separate scenarios for an AFS debt investment. In all three cases, the company does not intend to sell and does not believe it is more likely than not that it will be required to sell the investment before recovery of any unrealized loss. Assume that the company has already adjusted the AFS investments to fair value through OCI. Scenario Fair value $ Amortized cost $ Expected credit loss $ Impairment loss $ 1 216,000 $ 192,000 $ 36,000 $ 0$ 2 168,000 $ 192,000 $ 36,000 $ 24,000 3 144,000 192,000 36,000 48,000 x
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:Recording Entries for Impairment-AFS
Determine the amount of impairment loss (if any) to record in income under the
following three separate scenarios for an AFS debt investment. In all three cases, the
company does not intend to sell and does not believe it is more likely than not that it will
be required to sell the investment before recovery of any unrealized loss. Assume that
the company has already adjusted the AFS investments to fair value through OCI.
Scenario
Fair value
$
Amortized cost
$
Expected credit loss $
Impairment loss
$
216,000 $
192,000 $
36,000 $
0
$
2
168,000 $
192,000 $
36,000 $
24,000 $
3
144,000
192,000
36,000
48,000 x
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